AT&T Can Walk Away From DirecTV Deal If NFL Sunday Ticket Not Renewed

Who has time to destroy planets when you can watch all out-of-market NFL games live?

Who has time to destroy planets when
you can watch all out-of-market NFL games live?

Over the weekend, AT&T and DirecTV announced a huge $49 billion merger deal to make the nation’s largest satellite provider even larger and bolster the second-largest wireless provider’s efforts to compete with Verizon. But this merger could all fall to pieces if DirecTV doesn’t renew its exclusive deal with the NFL.

DirecTV pays the NFL about $1 billion a year to be the exclusive pay-TV carrier for its Sunday Ticket package that gives subscribers access to every out-of-market NFL game on Sundays.

Not only is it a huge deal for football fans who ante up for Sunday Ticket to watch in their own homes, many sports bars rely on Sunday Ticket access to bring in customers every weekend. If DirecTV were to lose this exclusivity, it could stand to lose a sizable chunk of its 20 million or so subscribers.

That’s why, according to the Wall Street Journal, if DirecTV and the NFL can’t come to another agreement, or if that agreement isn’t substantially close to what it has discussed with AT&T, the Death Star has the ability to step away from the merger.

About 1-in-10 DirecTV subscribers has the Sunday Ticket package, but the satellite company’s current exclusivity deal with the NFL ends after the upcoming season, and the Journal reports that the window in which the NFL was only allowed to negotiate with DirecTV has closed, meaning the league is free to take competing offers from other pay-TV providers.

If other pay-TV carriers were able to offer Sunday Ticket to customers, at least some of those DirecTV subscribers could look elsewhere for their TV service.

An exclusive deal with an AT&T-owned DirecTV would also put the NFL in the position of having deals with each of the top two wireless companies, as Verizon is currently the only wireless company with the rights to air a number of NFL games to users of its phones without the use of Sunday Ticket.